Sprint 'The Most Interesting Stock' On Wells Fargo's Wireless List Following Report Of Comcast Talks

Sprint Corp S shares were seen up 5.1 percent on Tuesday on reports the company has entered exclusive discussions with Comcast Corporation CMCSA and Charter Communications, Inc. CHTR about a potential wireless service deal. Details of the discussions are fuzzy at the moment, but the news of ongoing talks was enough to get Wells Fargo analyst Jennifer Fritzsche’s attention.

“We believe Sprint is one of the most interesting stocks on our wireless list right now,” Fritzsche wrote in a new note. The latest news just adds to the list of potential catalysts for Sprint, including M&A potential, margin expansion and deployment of 2.5 GHz spectrum, Fritzsche wrote (check out her track record here).

Related Link: Sprint Gets A Boost Amid Comcast Talks

Of course, a deal between Comcast, Charter and Sprint would have implications throughout the telecom and media/communications space. Here’s Wells Fargo’s take on some of the key players, including the firm's ratings on the stocks.

• Sprint (Outperform): The value of Sprint’s 2.5GHz spectrum is not currently reflected in the stock’s share price.
• Comcast (Outperform): Comcast could have the most leverage in a potential partnership with Sprint and Charter.
• Charter (Market Perform): The company’s focus on attracting premium customers is encouraging, but its murky outlook in an increasingly competitive environment warrants caution.
• DISH Network Corp DISH (Outperform): DISH will likely continue to pursue a partner in building a 5G-capable network, and the potential Sprint partnership deal “should not have any impact” on these plans.
• T-Mobile US Inc TMUS (Outperform): After openly touting the benefits of a potential merger with Sprint, the market may see T-Mobile as “the somewhat jilted bride.” However, the company’s positive trends in subscription growth and the strength of its brand have meaningful free cash flow generation in sight.
• AT&T Inc. T (Outperform): The company’s size and diversification coupled with the stock’s generous 5.1 percent dividend make it a core portfolio holding.
• Verizon Communications Inc. VZ (Market Perform): Verizon’s network remains the gold standard, but the company has a difficult revenue growth path ahead in the near-term.